SINCE taking office as New York’s chief ex ecutive, Gov. Spitzer has repeatedly pledged “to rein in spending and exhibit fiscal restraint” and to make sure the state’s finances are “transparent to the public.”

To achieve these noble goals, one runaway spending scheme the governor should examine with a jeweler’s eye is the state Personal Income Tax (PIT) bonds.

The state Constitution requires voter approval of all new state general-obligation debt – but lawmakers have been end-running that requirement for decades, with a host of “back-door borrowing” schemes. The result: Voters have only sanctioned about 7 percent of all New York state-supported debt now outstanding.

PIT bonds are the most egregious example of this financial abuse, and not just because the proceeds have gone largely to fund pork projects.

Gov. George Pataki and the Legislature created the instrument shortly after 9/11, when all eyes were on Ground Zero, not Albany. The bonds are backed by the state’s personal-income-tax revenues, with the state comptroller required by law to set aside at least 25 percent of each month’s payroll-witholding receipts in an account dedicated to payments on this debt. And if that fund isn’t enough to cover the PIT payments, the comptroller must get the needed cash from the general fund.

In other words, tax revenues normally (and properly) used for running the state’s day-to-day operations are being diverted to service debt not approved by the voters. This is the zenith of back-door borrowing.

The PIT enabling act also authorized five quasi-independent state authorities to issue PIT bonds (to fund projects approved by the governor and Legislature). And these agencies have been on a huge spending spree – running up $8.1 billion in PIT debt in the less than five years since.

Here’s the PIT-debt breakdown as of last month:

* Dormitory Authority: $3.8 billion

* Empire State Development Corp.: $2 billion

* Thruway Authority: $1.4 billion

* Housing Finance Authority: $500 million

* Environmental Facilities Authority: $400 million

Overall, state-supported debt nearly doubled in the Pataki years, from $28 billion in 1995 to $51 billion in 2006. PIT bonds issued since May 2002 account for 35 percent of the increase.

And there’s no end in sight. A Standard and Poors report last year revealed that “PIT borrowing will account for about two-thirds of all [New York] state borrowing over the next five years . . . . Total annual PIT issuance is forecast at $2 billion-$3 billion annually during the next five years.”

In other words, this finance gimmick is on track to increase state-supported debt at least 23 percent during Gov. Spitzer’s first term – all without voter approval.

Taxpayers are already stuck picking up the tab for already-issued PIT debt until 2035. PIT debt-service payments alone in 2007 will be $800 million. Add that to all the other state-supported bonds, and yearly interest and principal payments (which stood at $2.5 billion in 1994 and about $4.3 billion in 2006) could climb to $7.1 billion by 2011.

If Spitzer is determined to tackle Albany’s borrow-and-spend culture and to make state finances truly transparent, he’ll have to halt the use of this crafty financial stratagem.

Indeed, he should demand full adherence to Article 7 of the state Constitution, which provides “no debt shall be hereafter contracted by or in behalf of the state, unless such debt shall be authorized by law . . . No such law shall take effect until it shall, at a general election, have been submitted to the people, and have received a majority of all votes cast for and against it . . . ”

George J. Marlin is an investment banker. His latest book is “Squandered Opportunities: New York’s Pataki Years.”